An apparently soured Geely Automobile Holdings said it pulled out of the talks for 51% share in Malaysia’s ailing car maker, Proton.
The confirmation of the pullout came from Hong Kong-based daily South China Morning Post or SCMP, which said Geely’s president, An Conghui confirmed the pullout from the talks to the SCMP but did not give any specific reasons why.
Geely’s chairman Li Shufu had previously indicated the Malaysian firm had been uncertain about what it wanted from an overseas partner, in an interview with Bloomberg earlier this month.
Now the turf is left to the French automaker, the PSA Group, which is the second largest car manufacturer in Europe.
But how certain are the french in their bid?
The French are still hopeful they might be the new majority shareholders of Proton, though it was previously reported they were considering to pull out of the talks, having laid an eye on Indonesia’s potential in the Asean region.
Geely, the owner of the Swedish Volvo brand, was the favorite to acquire a controlling stake in Proton.
Proton owns the Lotus sports car marque and is looking for a strategic partner to assist in research and development as part of conditions it agreed to receive a loan of 1.5 billion ringgit ($384.9 million) from the Malaysian government last year.
The firm, once one of the Malaysia’s flagship companies, has been struggling with losing market share in Malaysia while failing to compete overseas.
The last time it recorded a better annual performance was in 2008, when a net profit of that year surged by 179 per cent to 866 million yuan from 2007, according to Reuters figures.